SEC File No. 333-68239

                          Filed Pursuant to Rule 497(h)

                              PROSPECTUS SUPPLEMENT
                       (TO PROSPECTUS DATED JUNE 18, 1999)

                            PILGRIM PRIME RATE TRUST

                      390,249 SHARES OF BENEFICIAL INTEREST

                                -----------------

     During the period  August 11, 1999 through  August 13, 1999,  Pilgrim Prime
Rate Trust (the "Trust") sold 390,249 shares of beneficial interest of the Trust
through a broker-dealer  that has entered into a selected dealer  agreement with
Pilgrim  Securities,  Inc.  ("PSI"),  which is the  underwriter for the Trust in
connection  with this offering.  The highest and lowest  executed sales price at
which shares were sold during that period was $9.50 and $9.4375.

Gross Proceeds ................................................    $3,683,287.44
Broker-Dealer Commissions......................................    $  147,331.50
Net Proceeds to Trust..........................................    $3,535,955.94

     On August 13, 1999 the last reported  sales price of the Shares on the NYSE
was $9.50

     Note: S.E.C. fees were not used in arriving at any of the above figures.

NEITHER  THE  SECURITIES  AND  EXCHANGE  COMMISSION  NOR  ANY  STATE  SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED THAT THIS
PROSPECTUS  IS TRUTHFUL OR  COMPLETE.  ANY  REPRESENTATION  TO THE CONTRARY IS A
CRIMINAL OFFENSE.

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           The date of this Prospectus Supplement is August 13, 1999.